Report: Intel to push Atom-based tablets with subsidies

Breaking into the tablet market has become one of Intel's top priorities. They just recently launched the Oak Trail platform and said that over 35 tablet and hybrid designs were coming from the likes of Samsung, Lenovo and others. According to a report on DigiTimes, Android 3.0 "Honeycomb" will be a big part of Intel's tablet push, and apparently the company is ready to throw in a $10 subsidy for each Intel-based tablet shipped in order to attract first-tier notebook vendors into the Atom fold.

This strategy is said to have been chalked-out after nearly half a year of negotiations with Google and is part of a new "PRC Plus" plan that touts Intel processor's advantage of stronger performance than ARM-based processors. The plan is also expected to save costs from Windows licensing fees for vendors who adopt Intel chips in tablets.

While Intel's subsidy strategy might raise a few eyebrows after the last round of antitrust fees and settlements, it may be a necessary (and still insufficient) move if rumors are true that the 1.5 GHz single-core Atom Z670 for tablets will cost an eye-watering $75 to OEMs. That's almost a fifth of the retail price of current tablets and close to four times as much in cost as the current industry favorite, the Nvidia Tegra 2, which is priced at around $20 for OEM orders.

Atom purportedly offers performance benefits over ARM-based designs, although it remains to be seen if its integrated graphics component can keep up with the latest system-on-chip designs optimized for gaming. In its announcement the company touted support for Android, MeeGo, and Windows, 1080p video decode, high-definition audio, HDMI and USB 2.0 connectivity, fast Internet browsing, and long battery life without sacrificing performance.